Pule is purchasing four bottles of bathroom cleaner for $3 each. The maximum prices she would have been willing to pay for each bottle are $6 for the first bottle, $5 for the second bottle, $4 for the third bottle, and $3 for the fourth bottle. The marginal revenue for each bottle is $2.50. What is Pule's total consumer surplus from purchasing the four bottles of bathroom cleaner?
A)$6
B)$2
C)$.50
D)$0

Question

Quizplus · Accepted Answer

Consumer surplus is the difference between what a consumer is willing to pay and what they actually pay. For the first bottle, the surplus is $6 - $3 = $3. For the second bottle, it's $5 - $3 = $2. For the third bottle, it's $4 - $3 = $1. For the fourth bottle, there's no surplus because she's willing to pay exactly what it costs, $3 - $3 = $0. Adding these up gives a total consumer surplus of $3 + $2 + $1 + $0 = $6.

Pule Is Purchasing Four Bottles of Bathroom Cleaner for $3